FSB pay-reporting plan unnecessary for US insurers, state regulators say

22 August 2018 1:36am
US state insurance regulators said that a Financial Stability Board plan to urge jurisdictions to improve reporting of compensation practices, aimed at preventing misconduct, would serve little purpose for American insurers.

American insurance companies are not nearly as prone as banks to violate laws as a result of executives’ or traders’ pay incentives, the National Association of Insurance Commissioners, a group of state regulators, said in a recent letter.

“US state insurance supervisors have not identified a trend of insurer compensation programs leading to increased levels of misconduct,” the letter to the Switzerland-based global authority said. “The most important changes in firms’ management of compensation and conduct risk in recent years have been to align compensation programs and incentives with risk appetites, tolerances and limits."